·Operating profit EUR 2,778 (1,002)
million, of which EUR 1,863 (22) million relates to items affecting
comparability, i.e. mainly to the sale of the electricity distribution business
in Finland

·Earnings per share EUR 2.91 (0.84),
+246%, of which EUR 2.11 (0.03) per share relates to items affecting
comparability. The main effect relates to the sale of the Finnish electricity
distribution business totalling EUR 2.08 per share

·Sale of the Finnish and Norwegian
electricity distribution as well as the Norwegian heat business finalised

*) Comparative period figures for 2013
presented in the interim report are restated due to an accounting change for
Fortum Värme and segment reporting changes; see page 6 as well as Notes 2 and
4.
**) LTM, Last 12 months

Summary of outlook

Fortum continues to expect the annual
electricity demand growth in the Nordic countries to be on average 0.5% in the
coming years

Power and Technology Segment's Nordic
generation hedges: for the rest of the calendar year 2014, approx. 70% hedged
at EUR 43 per MWh; for the 2015 calendar year, approx. 40% hedged at EUR 41 per
MWh; and for 2016, 10% hedged at EUR 39 per MWh

The run-rate operating profit (EBIT) target
for the Russia Segment RUB 18.2 billion, is to be reached during 2015. The
euro-denominated result level will be volatile mainly due to the translation
effect

”During the
third quarter of 2014, electricity demand was flattish both in the Nordic
countries and in Fortum's operating areas in Russia. However, Fortum was able
to use its flexible production portfolio to its advantage in a market otherwise
characterised by low electricity prices.

Hydro
production volumes, in particular, contributed positively in the third quarter
and partly offset the negative effects from lower electricity prices. Heat and
distribution volumes were lower and hence impacted negatively on the results.
The new capacity in Russia had a positive effect on the result. In late
September, the third unit at Fortum's Nyagan Power Plant passed the
comprehensive certification tests that precede commissioning. The commercial
operation of the unit is planned to take place by the end of 2014 and capacity
payments are scheduled to start as of 1 January 2015. Cash flow from operating
activities for the company continued strong.

The
efficiency programme started in late 2012 to maintain and strengthen Fortum’s
flexibility and competitiveness, is close to completion and is estimated to be
successfully finalised by the end of 2014.

We continued
the work on preparing and evaluating the possible future divestment of our
Swedish electricity distribution business.

It is
important to be prepared for possible industrial restructuring opportunities in
today’s market. The successful execution of the ongoing efficiency programme
and divestments of the Finnish and Norwegian electricity distribution business
have further strengthened Fortum’s balance sheet. Fortum possesses the
competencies, strategic positioning and balance sheet strength to take
advantage of new opportunities that might occur in the market, and our target
is to grow in line with our strategy."

Efficiency programme 2013-2014

Fortum started an efficiency programme in
2012 in order to maintain and strengthen its strategic flexibility and
competitiveness and to enable the company to reach its financial targets in the
future.

The aim is to improve the company’s cash flow
by more than approximately EUR 1 billion during 2013–2014 by reducing capital
expenditures (capex) by EUR 250–350 million, divesting approximately EUR 500
million of non-core assets, reducing fixed costs and focusing on working
capital efficiency.

At the end of 2014, the cost run-rate is
targeted to be approximately EUR 150 million lower compared to 2012, including
growth projects.

If headcount reductions are needed, Fortum
seeks to limit redundancies whenever possible. The assessments will therefore
be done at a unit level.

At the end of September, Fortum had announced
non-core asset divestments of approximately EUR 500 million since the start of
the efficiency programme.The company has also been able to decrease its costs
and improve its working capital efficiency according to plan. The programme is
close to completion and is estimated to be successfully finalised by the end of
2014.

Assessment of the electricity distribution business

The decision to start a strategic assessment
of future alternatives for Fortum’s electricity distribution business was made
in 2013.

In March 2014, Fortum completed the
divestment of its Finnish electricity distribution business. In June, Fortum
finalised its sale of the Norwegian electricity distribution business. The
sales gains from the both transactions were booked in Fortum's Distribution
Segment in the first and second quarter of 2014, respectively (Note 6).

Fortum is currently preparing and evaluating
possibilities to divest its distribution business in Sweden.

Restatement related to IFRS changes and the new reporting
structure

As of 1 January 2014, Fortum has applied the
new IFRS 10 Consolidated Financial Statements and 11 Joint Arrangements
standards. The major effect of this reassessment relates to Fortum Värme, which
is treated as a joint venture and thus consolidated with the equity method
(Note 2). Comparative information for 2013 presented in this interim report has
been restated accordingly.

The segment information for 2013 has been
restated due to the change in the organisation from 1 March 2014.

As of 2014, presented figures have been
rounded and consequently the sum of individual figures may deviate from the sum
presented.

In the third quarter of 2014, Group sales
were EUR 976 (1,060) million. Comparable operating profit totalled EUR 183
(167) million and the reported operating profit totalled EUR 149 (96) million.
Fortum's operating profit for the period was affected by non-recurring items.
Sales gains as well as an IFRS accounting treatment (IAS 39) of derivatives mainly
used for hedging Fortum's power production and nuclear fund adjustments
amounted to EUR -34 (-70) million (Note 4).

Sales by segment

EUR million

III/14

III/13

I-III/14

I-III/13

2013

LTM

Power and Technology

495

496

1,568

1,709

2,252

2,111

Heat, Electricity Sales and Solutions

224

255

939

1,094

1,516

1,361

Russia

207

210

774

805

1,119

1,088

Distribution

130

217

578

784

1,064

858

Other

14

14

42

43

63

62

Netting of Nord Pool transactions

-67

-90

-301

-356

-478

-423

Eliminations

-26

-42

-134

-161

-228

-201

Total

976

1,060

3,466

3,918

5,309

4,857

Comparable operating profit by segment

EUR million

III/14

III/13

I-III/14

I-III/13

2013

LTM

Power and Technology

167

139

601

652

859

808

Heat, Electricity Sales and Solutions

-4

-3

55

68

109

96

Russia

1

-15

102

46

156

212

Distribution

36

59

200

256

332

276

Other

-16

-14

-43

-42

-54

-55

Total

183

167

915

979

1,403

1,339

Operating profit by segment

EUR million

III/14

III/13

I-III/14

I-III/13

2013

LTM

Power and Technology

124

44

537

644

922

815

Heat, Electricity Sales and Solutions

4

8

116

83

134

167

Russia

1

-15

102

46

156

212

Distribution

36

76

2,066

274

349

2,141

Other

-16

-17

-44

-45

-53

-52

Total

149

96

2,778

1,002

1,508

3,284

January−September

In January-September 2014, Group sales were
EUR 3,466 (3,918) million. Comparable operating profit totalled EUR 915 (979)
million and the reported operating profit totalled EUR 2,778 (1,002) million.
Fortum's operating profit for the period was affected by non-recurring items,
mainly the sale of the Finnish electricity distribution business, the Norwegian
electricity distribution and heat businesses as well as an IFRS accounting
treatment (IAS 39) of derivatives mainly used for hedging Fortum's power
production and nuclear fund adjustments amounting to EUR 1,863 (22) million
(Note 4).

The share of profit from associates in
January-September was EUR 111 (115) million, of which Fortum Värme represents
EUR 42 (49) million. The share of profit from Hafslund and TGC-1 are based on
the companies' published second-quarter 2014 interim reports (Note 12).

Taxes for the period totalled EUR 134 (157)
million. The tax rate according to the income statement was 4.9% (17.4%). In
Finland, the corporate tax rate was decreased from 24.5% to 20.0% starting
1 January 2014. The tax rate, excluding the impact of the share of profit
from associated companies and joint ventures as well as non-taxable capital
gains, was 19.4% (20.7%).

The profit for the period was EUR 2,587 (748)
million. Fortum's earnings per share were EUR 2.91 (0.84), of which EUR 2.11
(0.03) per share relates to items affecting comparability. The earnings per
share impact from the sale of the Finnish electricity distribution business was
EUR 2.08 per share (Note 6).

Financial position and cash flow

Cash flow

In January-September 2014, total net cash
from operating activities increased by EUR 160 million to EUR 1,310 (1,150)
million, mainly due to the EUR 262 million positive impact of realised foreign
exchange differences, which were partly offset with a lower EBITDA. Realised
foreign exchange gains and losses of EUR 216 (-46) million were related to the
rollover of foreign exchange contract hedging loans to Fortum's Swedish and
Russian subsidiaries. Capital expenditures decreased by EUR 146 million to EUR
524 (670) million. Proceeds from divestments of shares totalled EUR 2,687 (107)
million, mainly from the divestment of the Finnish distribution business as
well as the Norwegian electricity distribution and heat businesses (Note 6).
Proceeds from interest-bearing receivables included EUR 467 million paid by
Fortum Värme. Total net cash used in investing activities was positive EUR
2,677 (-497) million. Cash flow before financing activities, i.e. financing,
increased by EUR 3,334 million to EUR 3,987 (653) million.

The proceeds were partially used to pay
dividends totalling EUR 977 million in April as well as payments of
interest-bearing debt amounting to EUR 2,136 million. Cash and cash equivalents
at the end of the period were EUR 2,178 (1,265 at year-end 2013) million.

Assets and capital employed

Total assets decreased by EUR 1,708 million
to EUR 21,640 (23,348 at year-end 2013) million, which includes the decrease of
non-current assets, EUR 1,057 million. Translation differences decreased
intangible assets, property, plant and equipment as well as participation in
associates and joint ventures by EUR 580 million and divestments by EUR 302
million.

Assets of the Finnish distribution business,
amounting to EUR 1,173 million, were presented as Assets held for sale at the
end of 2013. Cash and cash equivalents increased by EUR 913 million.

Total equity was EUR 11,336 (10,124 at
year-end 2013) million, of which equity attributable to owners of the parent
company totalled EUR 11,255 (10,024) million and non-controlling interests EUR
81 (101) million.

The increase in equity attributable to owners
of the parent company totalled EUR 1,231 million and was mainly from the net
profit of EUR 2,583 million for the period, offset by translation differences
of EUR -305 million and paid dividends of EUR 977 million.

At the end of September 2014, the Group’s
liquid funds totalled EUR 2,178 (1,265 at year-end 2013) million.Liquid funds include cash and bank deposits
held by OAO Fortum amounting to EUR 259 (113 at year-end 2013) million. In
addition to the liquid funds, Fortum had access to approximately EUR 2,2
billion of undrawn committed credit facilities.

Fortum Corporation's long-term credit rating
with both S&P and Fitch has remained unchanged and is A- (negative
outlook).

Key figures

For the last twelve months, net debt to
EBITDA was 1.2 (3.7 at year-end 2013) and comparable net debt to EBITDA 2.6
(3.9 at year-end 2013). Fortum is currently financing Fortum Värme, and these
loans, EUR 639 (1,135 at year-end 2013) million, are presented as interest-bearing
loan receivables in Fortum’s balance sheet. However, the aim is to refinance
the loans during 2014-2015. If these loans are deducted from the net debt, the
last-twelve-months comparable net debt to EBITDA is 2.2 (3.4 at the year-end
2013).

Gearing was 42% (77%) and the
equity-to-assets ratio 52% (43%). Equity per share was EUR 12.67 (11.28). For
the last twelve months, return on capital employed totalled 18.9% (9.0% at
year-end 2013) and return on shareholders’ equity 29% (12.0% at year-end 2013).
Both return on capital employed and return on equity were positively affected
by the capital gain from the sale of the Finnish electricity distribution
business as well as the sale of the Norwegian electricity distribution and heat
businesses.

Outlook

Key drivers and risks

Fortum's financial results are exposed to a
number of economic, strategic, political, financial and operational risks. One
of the key factors influencing Fortum's business performance is the wholesale
price of electricity in the Nordic region. The key drivers behind the wholesale
price development in the Nordic region are the supply-demand balance, fuel and
CO2 emissions allowance prices as well as the hydrological situation. The
completion of Fortum’s investment programme in Russia is also one key driver to
the company’s result growth, due to the increase in production volumes and CSA
payments.

The continued global economic uncertainty and
Europe's sovereign-debt crisis has kept the outlook for economic growth
unpredictable. The overall economic uncertainty impacts commodity and CO2
emissions allowance prices, and this could maintain downward pressure on the
Nordic wholesale price for electricity in the short term. In Fortum's Russian
business, the key factors are economic growth, the rouble exchange rate, the
regulation around the heat business, and further development of electricity and
capacity markets. Operational risks related to the investment projects in the
current investment programme are still valid. In all regions, fuel prices and
power plant availability also impact profitability. In addition, increased
volatility in exchange rates due to financial turbulence could have both
translation and transaction effects on Fortum's financials, especially through
the Swedish krona (SEK) and the Russian rouble (RUB). In the Nordic countries,
also the regulatory and fiscal environment for the energy sector has added
risks for utility companies.

Nordic market

Despite macroeconomic uncertainty,
electricity is expected to continue to gain a higher share of the total energy
consumption. Fortum continues to expect the annual growth rate in electricity
consumption to be on average 0.5%, while the growth rate for the nearest years
will largely be determined by macroeconomic development in Europe and
especially in the Nordic countries.

During January-September 2014, the price of
oil and European Union emissions allowances (EUA) appreciated, whereas the coal
price declined. The price of electricity for the upcoming twelve months ended
practically unchanged in the Nordic area whereas in Germany it decreased.

In mid-October 2014, the future quotation for
coal (ICE Rotterdam) for the rest of 2014 was around USD 71 per tonne, and the
price for CO2 for 2014 was about EUR 6 per tonne. The electricity forward price
in Nord Pool for the rest of 2014 was around EUR 32 per MWh. For 2015, the
price was around EUR 31 per MWh, and, for 2016, around EUR 30 per MWh. In
Germany, the electricity forward price for the rest of 2014 was around EUR 34
per MWh and for 2015 EUR 34 per MWh. Nordic water reservoirs were about 10 TWh
below the long-term average and 2 TWh above the corresponding level of 2013.

Power and Technology

The Power and Technology Segments Nordic
power price typically depends on factors such as hedge ratios, hedge prices,
spot prices, availability and utilisation of Fortum's flexible production
portfolio, and currency fluctuations. Excluding the potential effects from the
changes in the power generation mix, a 1 EUR/MWh change in the Power and
Technology Segment’s Nordic power sales (achieved) price will result in an
approximately EUR 45 million change in Fortum's annual comparable operating
profit. In addition, the comparable operating profit of the Power and
Technology Segment will be affected by the possible thermal power generation
volumes and its profits.

The ongoing, multi-year Swedish nuclear
investment programmes are expected to enhance safety, improve availability and
increase the capacity of the current nuclear fleet. The implementation of the
investment programmes could, however, affect availability. Fortum’s power
procurement costs from co-owned nuclear companies are affected by these
investment programmes through increased depreciation and finance costs of
associated companies.

As a result of the nuclear stress tests
in the EU, the Swedish nuclear safety authority (SSM) has decided to propose
new regulations for Swedish nuclear reactors. The process is on-going and the
final proposal is expected by the end 2014. Fortum emphasises that maintaining
a high level of nuclear safety is the highest priority, but considers EU-level
harmonisation of nuclear safety requirements to be of utmost importance.

The process to review the Swedish nuclear
waste fees is done in a three-year cycle, and therefore SSM has given a new
proposal for the nuclear waste fees. A government decision is expected by the
end of 2014.

The new Swedish government has proposedto increase the tax on installed nuclear
capacity by 17% as of 2015. Fortum's position is that the tax issue should be
referred to an upcoming parliamentary energy commission in order to get a
broadly established view on how the needs of energy and effect can be resolved.

Russia

The generation capacity built after 2007
under the Russian Government's Capacity Supply Agreements (CSA – “new
capacity”) receives guaranteed capacity payments for a period of 10 years.
Prices for capacity under CSA are defined in order to ensure a sufficient
return on investments. The issue of prolonged CSA payments from 10 to 15 years
have been under discussion in the Russian Government; however, no official
decisions have yet been made.

Capacity not under CSA competes in the
competitive capacity selection (CCS – “old capacity”). The capacity selection
for generation built prior to 2008 (CCS – “old capacity”) for 2015 was held in
September 2014. All of Fortum’s capacity was allowed to participate in the
selection for 2015 and the majority of Fortum’s plants were also selected. The
volume of Fortum’s installed capacity not selected in the auction totalled 195
MW (approximately 3.7% of Fortum’s total old capacity in Russia) for which
Fortum plans to obtain forced mode status.

The Russia Segment's new capacity will be a
key driver for earnings growth in Russia, as it is expected to bring income
from new volumes sold and to also receive considerably higher capacity payments
than the old capacity. However, the received capacity payment will differ
depending on the age, location, size and type of the plants as well as on seasonality
and availability. The return on the new capacity is guaranteed, as regulated in
the CSA. CSA payments can vary somewhat annually because they are linked to
Russian government long-term bonds with 8 to 10 years maturity. In addition,
the regulator will review the earnings from the electricity-only market three
years and six years after the commissioning of a unit and may revise the CSA
payments accordingly.

The value of the remaining part of the
investment programme, calculated at the exchange rates prevailing at the end of
September 2014, is estimated to be approximately EUR 0.3 billion, as of October
2014.

The Russian result is impacted by seasonal
volatility caused by the nature of the heat business, with the first and last
quarter being clearly the strongest.

At the time of the acquisition of the Russian
subsidiary OAO Fortum in 2008, the EUR 500 million run-rate level in operating
profit (EBIT) target set to be reached during 2015 in the Russia Segment
corresponded to approximately RUB 18.2 billion at the then prevailing
euro-rouble exchange rates. As earlier communicated, the segment’s profits are
mainly impacted by changes in currency exchange rates as well as power demand,
gas prices and other regulatory development. Fortum is keeping its rouble-denominated
target intact, but, mainly due to the translation effect, the
euro-denominated result level will be volatile. Currently, the unfavourable
exchange balance converts into a lower profit level in euros. However, every
effort to mitigate the negative impacts is continuously being made.

In 2013, the Ministry of Energy stated that
the heat reform should be developed before changing the current electricity and
capacity market model.The Ministry of Energy proposed a new heat market model
(for public discussion), which is supposed to ensure a transition to
economically justified heat tariffs by 2020 and attract investments into the
heat sector. In September 2014, the heat market reform road map was approved by
Russian Government. According to the roadmap the reform shall give heat market
liberalization by 2020 or, in some specific areas, by 2023.

As forecasted by the Russian Ministry of
Economic Development, Russian gas price indexation did not take place in July
2014. However, year-on-year gas price growth is estimated to be 7.6% in 2014.

Distribution

Fortum is preparing for a possible sale of
the Swedish electricity distribution business. The decision to complete the
process is dependent on market development and development of national regulation,
among other factors.

In Sweden, legal processes are under way
concerning the appeal filed regarding the network income regulatory period
2012-2015. The Administrative Court in Sweden ruled in favour of the network
companies in December 2013. The Energy Market Inspectorate decided to appeal
the decision, and was given during leave to appeal to the Administrative Court
of Appeals during the first quarter; therefore, the process continues. The
court hearing is expected in Q4 2014 or Q1 2015.

The work to define the Swedish network income
regulation model for the next regulatory period 2016-2019 is ongoing. In
September 2014, the Swedish government made a decision regarding the capital
base ordinance; however, the details will be decided by the Energy Market
Inspectorate. Decisions are expected to be made during 2014.

Capital expenditure and divestments

Fortum currently expects its capital
expenditure in 2014 to be approximately EUR 0.9-1.1 billion, excluding
potential acquisitions. The Finnish distribution business is included in the
figure until the end of the first quarter 2014 and the Norwegian distribution
business until the end of the second quarter 2014. The annual maintenance
capital expenditure is estimated to be about EUR 400-500 million in 2014, below
the level of depreciation. Capex for electricity distribution in Finland and
Norway was approximately EUR 150 million annually.

Fortum will gradually decrease its financing
to Fortum Värme, the co-owned power and heat company operating in the capital
area in Sweden, during 2014-2015. At the end of September 2014, Fortum Värme's
remaining interest bearing liability to Fortum is approximately EUR 0.6
billion.

Taxation

The effective corporate income tax rate for
Fortum in 2014 is estimated to be 19–21%, excluding the impact of the share of
profits of associated companies and joint ventures, non-taxable capital gains
and non-recurring items. In Finland, the corporate tax rate was reduced from
24.5% to 20% as of 1 January 2014.

The Finnish government decided in June that
it will not, after all, introduce a power plant tax (windfall tax) on nuclear,
hydro and wind power built before 2004. The final decision to revoke the tax
will be made by the Parliament in autumn 2014.

In August, the Finnish Board of Adjustment of
the Large Taxpayers’ Office had unanimously approved Fortum Corporation's
appeal for the income tax assessment imposed on Fortum for the year 2007 in
December 2013. The Tax Recipients’ Legal Services Unit has the right to appeal
in the matter (Note 21).

Hedging

At the end of September 2014, approximately
70% of Power and Technology's estimated Nordic power sales volume was hedged at
approximately EUR 43 per MWh for the rest of 2014. The corresponding figures
for the calendar year 2015 were approximately 40% at approximately EUR 41 per
MWh and for the calendar year 2016 approximately 10% at approximately EUR 39
per MWh.

The hedge price for Power and Technology's
Nordic generation excludes hedging of the condensing power margin. In addition,
the hedge ratio excludes the financial hedges and physical volume of Fortum's
coal-condensing generation as well as the segment’s imports from Russia.

The reported hedge ratios may vary
significantly, depending on Fortum's actions on the electricity derivatives
markets. Hedges are mainly financial contracts, most of them Nord Pool
forwards.

Dividend payment

The Annual General Meeting 2014 decided to
pay a dividend of EUR 1.10 per share for 2013. The record date for the dividend
was 11 April 2014, and the dividend payment date was 22 April 2014.

The condensed interim financial statements
have been prepared in accordance with International Accounting Standard (IAS)
34, Interim Financial Reporting, as adopted by the EU. The interim financials
have not been audited.

Fortum Corporation’s Financial statements
bulletin for the year 2014 will be published on 4 February 2015 at
approximately 9.00 EET.

Fortum will publish three interim reports in
2015:

- January-March on 29 April 2015 at
approximately 9.00 EEST

- January-June on 17 July 2015 at
approximately 9.00 EEST

- January-September on 22 October 2015 at
approximately 9.00 EEST

Fortum’s Financial statements and Operating
and financial review for 2014 will be published during week 10 at the latest.

Fortum's Annual General Meeting is planned to
take place on 31 March2015 and the
possible dividend related dates planned for 2015 are:

- Ex-dividend date 1 April 2015

- Record date for dividend payment 2 April
2015

- Dividend payment date 14 April 2015

Distribution:

NASDAQ OMX Helsinki

Key media

www.fortum.com

More information, including detailed
quarterly information, is available on Fortum’s website at www.fortum.com/investors.